Months after ₹6k crore IPO, Raajmarg Infra mulls another share sale

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Months after raising ₹6,000 crore in an initial public offering, Raajmarg Infra Investment Trust (RIIT) is evaluating a share issuance to fund asset acquisitions, according to three people with knowledge of the matter.

The trust, which is backed by the government, is considering a qualified institutional placement or a follow-on public offer, the people said, asking not to be named because the discussions are private.

While InvITs are allowed to borrow capital from banks to fund growth, RIIT's push for a share issuance comes at a time when the government is looking to increase participation in the asset class.

"The trust is looking to broaden its base of unit holders while securing capital for toll roads," one of the abovementioned people said. Currently, RIIT is said to be leaning towards an FPO rather than a QIP to increase unit ownership among retail buyers, this person added. "A follow-on public offer gives individuals a route to receive yield from infrastructure assets," they said.

Currently, individuals own only about 7% units in Raajmarg. The Trust's sponsor, the National Highways Authority of India owns 15%, while the rest is held by institutions.

An adviser is currently working with the trust to select assets for purchase, the second person aware of the matter said.

"The identification of assets is in progress with an independent adviser," this person added. "The figure for capital raising depends on asset valuations provided by the adviser."

As of March-end, 2026, the InvIT has net assets worth ₹6,043 crore.

A third person confirmed the developments, while cautioning that timelines and fundraising scenarios can change depending on market conditions and the assets being identified.

Mint has reached out to Raajmarg for comments on the story.

Infrastructure investment trusts function like mutual funds, pooling capital from investors to acquire infrastructure that generates revenue. India introduced regulations for InvITs in 2014 to help developers monetize projects and reduce debt.

Currently, Raajmarg has a Right of First Offer (ROFO) agreement with its sponsor, the National Highways Authority of India, under which the latter will be transferring 1,500 km of road assets to the InvIT over the next three to five years.

Other than that, Raajmarg also said in its offer document from 28 February that its investment manager intends to expand the InvIT's "initial portfolio by identifying and selectively acquiring additional toll road projects" that meet its investment criteria.

"The Investment Manager intends to capitalize on opportunities to acquire road projects in India that provide attractive cash flows and yields," the document had added.

Unlike other large institutions that can use free cash flows to fund acquisitions, InvITs are required to distribute at least 90% of their cash flows to unitholders every financial year. While Raajmarg is a relatively new Trust that got its registration only by December 2025, and reported a distributable cash flow of negative ₹3.7 crore for FY26, a March 2026 note by Axis Capital estimates the combined cash flows to reach ₹862 crore by the end of fiscal 2027, and ₹1,061 crore by end of fiscal 2028.

In March, Raajmarg became the first publicly listed InvIT sponsored by the state-owned NHAI to be listed on India's exchanges. It debuted at an 8% premium over its issue price with a market capitalisation of ₹6,393 crore after getting subscribed 13.88 times in a bidding process led by qualified institutional buyers.

Ahead of the IPO, the InvIT had also raised ₹1,728 crore from anchor investors like LIC, ICICI Prudential Life Insurance, Kotak Mahindra Life Insurance and Bajaj Life Insurance.

At the listing of the InvIT, union minister for road transport and highways Nitin Gadkari had said, "Amid economic growth, there is growth in the automobile segment as well. With this growth, toll co...